TC Palm Q&A Column, April 9, 2017

By April 9, 2017News, Questions & Answers

Editor’s note: Attorneys at Goede, Adamczyk, DeBoest & Cross, respond to questions about Florida community association law.  The firm represents community associations throughout Florida and focuses on condominium and homeowner association law, real estate law, litigation, estate planning and business law.

Q:   We have a unit owner who is leasing contrary to our documents and without Board approval.  Our rules allow no more than three leases a year. We have approved three lease periods for a minimum of 30 days this year, but advised the owner that after these leases no further leases would be approved until January 2018. The unit concerned now has a family staying there who claim “the owner is allowing them to stay there for 3 months for free”. There is little doubt that the owner has told the tenants to say this. In any case our docs do not permit such arrangements. Apart from us evicting the tenants, which our docs appear to allow, what other action can we take against the owner to prevent him flouting our rules?

R.G., Stuart

A:  It is indeed unfortunate that owners and occupants will simply lie to get around the rules they agreed to when they moved into the community.  If you have a good faith, reasonable belief that the occupants are indeed renters the Board can use any or all of its enforcement tools.  Those tools include levying fines and suspending use rights to common amenities such as the pool.  You cannot suspend the occupant’s right to enter and exit the community and park their vehicles though.  As you mentioned you can also sue the tenant for eviction. While owners and tenants may be bold enough to lie to the Board they often lose their courage when standing in front of a Judge.  You should also inform the owner that future leases may be denied.

Q: I am on my condominium Board and want to set up a trust for my estate plan but am hesitant to do so because I have been told that I would be ineligible for the Board once my unit is transferred to a living trust.  Is this true?

C. G., Hutchinson Island

A: There are many types of trusts and estate planning vehicles that would have a different result on Board eligibility, so I will assume that you are referring to a revocable living trust in which you are also the trustee.  This is a common scenario where individuals will utilize a revocable living trust to possibly avoid probate and protect assets for future generations.  To properly answer the question I would need to know more about your estate planning objectives and specifically review your condominium governing documents, but the general answer is that you would remain eligible.  Florida Statutes section 617.0802 governing not for profit corporations provides that either a) the grantor of a revocable trust; or b) a beneficiary of a trust occupying the unit are eligible to serve on the Board of Directors if the trust owns the condominium unit.  So, based on the assumptions above, if you create a trust and place your condominium unit into a revocable trust, and you remain a beneficiary of the trust during your lifetime, your eligibility should not be questioned as a result of the transfer.

Q: There are rumors floating around that our condominium does not have enough insurance in the event of a hurricane or other casualty.  How can we determine if the Board is maintaining sufficient insurance?

O.C., Port Salerno

A: A copy of the insurance policies are required to be maintained by the condominium as official records and the statutes require the condominium to make the policies available upon the written request of an owner or its authorized representative.   The condominium must make the policies available for inspection within 5 business days of receipt of your request.

Another option is to send a written inquiry to the Association.  If you send a substantive question to the condominium via certified mail, the Board is required to provide a substantive response within 30 days or possibly longer if a legal opinion is required.

After you have the policies, you should compare them to the statutory requirements set forth in Florida Statutes section 718.111(11) which provides that the condominium must maintain “adequate property insurance” which is for the full insurable value, replacement cost, or similar coverage, and must be based on replacement cost of the property as determined by an independent insurance appraisal.  Presumably the condominium should also have the appraisal (or an update thereof) as an official record as well for inspection so you should be able to determine statutory compliance with this information.

Steven R. Braten Esq., is Managing Partner, Palm Beach of the Law firm Goede, Adamczyk, DeBoest & Cross.  Ask questions about your issues for future columns, send your inquiry to: bocaquestion@GADClaw.com.  The information provided herein is for informational purposes only and should not be construed as legal advice.  The publication of this article does not create an attorney-client relationship between the reader and Goede, Adamczyk, DeBoest & Cross, or any of our attorneys.  Readers should not act or refrain from acting based upon the information contained in this article without first contacting an attorney, if you have questions about any of the issues raised herein.  The hiring of an attorney is a decision that should not be based solely on advertisements or this column.